TaxTMI 
TaxTMI 
2024 (10) TMI 1535
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....ion of IT Service provider for executing driving license & registration certificate related services, etc. for office of the Transport Commissioner, Odisha and its sub-ordinate offices for a period of one year". The mode of submission of proposals was physical. The last date of submission of proposals was 10.08.2023 and opening of technical proposals was 11.08.2023. It was mentioned that date and time of opening of the price proposals will be communicated later to the technically qualified bidders at e-mail ID provided by them. As regards method of selection, it was mentioned as "Least Cost Method (L1 selection). 2.1. The petitioner, having satisfied all the criteria as per RFP, participated in the tender process and the technical evaluation committee selected the bid of the petitioner. In the financial bid, the petitioner was L1 bidder, but, opposite party no.4, vide letter dated 06.10.2023 under Annexure-1, communicated that its financial bid was not considered as its performance relating to deployment of manpower in RTO offices earlier was not satisfactory and it has not deposited statutory dues in respect of manpower supplied. 2.2. Opposite party no.4, vide letter dated 1....
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....ner. It is further contended that since the letter dated 06.10.2023 under Annexure-1 has been issued without specifying with regard to violation of any condition of the tender, the same cannot be sustained in the eye of law. Thereby, the decision making process of the authority being arbitrary, unreasonable and contrary to the provisions of law, this Court can exercise power of judicial review to prevent arbitrariness and unreasonableness in the decision of the authority concerned. To substantiate his contentions, he has relied upon the judgments in Mohabir Auto Stores v. Indian Oil Corporation, AIR 1990 SC 1031 : (1990) 3 SCC 752; Reliance Energy Ltd. and Anr. v. Maharashtra State Road Development Corpn. Ltd. & Ors,, (2007) 8 SCC 1; Adani Gas Limited v. Petroleum and Natural Gas Regulatory Board & Ors., (2020) 4 SCC 529; M/s. D.K. Engineering & Construction v. State of Odisha & Anr., 2016(II) ILR-CUT-515; M/s. Famous Security Services v. State of Odisha, AIR 2021 (Odisha) 57 and Mihan India Ltd. v. GMR Airports Ltd., AIR 2022 SC 2745. 4. Mr. P.P. Mohanty, learned Addl. Government Advocate appearing for the State-opposite party no.1 contended that since the matter relates to opp....
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....ppearing for the State-opposite party no.1; and Mr. Pravakar Behera, learned Standing Counsel appearing for opposite parties no.2 to 4 in hybrid mode. Pleadings have been exchanged between the parties and with the consent of learned counsel for the parties, the writ petition is being disposed of at the stage of admission. 7. On careful perusal of the records, this Court finds that opposite party no.3 invited tender for "Selection of IT Service provider for executing driving license & registration certificate related services, etc. for office of the Transport Commissioner, Odisha and its sub-ordinate offices for a period of one year". The relevant provisions of the RFP read thus:- "6. Instruction To Bidders Xxx xxx xxx 6.1 Preparation of Proposal Proposals shall include "Technical Proposal" and "Financial Proposal" The content of proposal should be as below: I. Cover Page: * Super scribed with "Selection of IT service provider for executing Driving License & Registration Certificate Related Services, etc. for office of the Transport Commissioner, Odisha and its sub-ordinate offices for a period of one year." ....
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....-21, FY 2021-22) * Audited Financial Statements for last 3 financial years of bidder. * Certificate from the Statutory Auditor/ Chartered Accountant clearly specifying the average annual turnover of the bidder for the specified years. 3. Experience of bidder The bidder should have experience of providing IT support services on man-hour basis for minimum 2 projects to any Central/ State Government Department or Central /State Public Sector Undertakings (PSUs) or any other Government (Central/ State/ PSU/ ULBs/ Smart Cites SPV) in India in last Five (5) years on the due date of proposal submission. * Copy of relevant Work Order and *Completion Certificate from Authority * Ongoing Similar Projects with performance Certificate from Authority and the project should be operational for more than two years. 4. Non- Blacklisted Undertaking Self-declaration by the bidder confirming that they have not been blacklisted by any Central/State Government Department or Central/State Public Sector Undertakings (PSUs) or any other Government (Central/ State/PSU/ ULBs/ Smart Cites SPV) Organization in India as on proposal due date. Self-declaration by the bidder sig....
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.... Commissioner, Odisha does not bind itself to accept the lowest proposal. * Office of the Transport Commissioner, Odisha also reserves the right to accept or reject any proposal in part or full without assigning any reason whatsoever. * Office of the Transport Commissioner, Odisha reserves absolute right to reject any or all the bids at any time solely based on the past unsatisfactory performance by the bidder(s) the opinion/decision of Office of the Transport Commissioner, Odisha regarding the same shall be final and conclusive. Xxx xxx xxx 7. Selection Criteria 7.1 Evaluation Process The proposals submitted by the bidders will be evaluated on parameters as described in this RFP document. The bidder must get at least 60% of the maximum score i.e. out of total @100 marks, in the evaluation process in order to qualify for opening of the commercial/financial evaluation. 7.2 Evaluation Criteria Sl. No Criteria Parameter Maximum Mark Supporting Document Marking Criteria A. Company Competency A1 Company Competency Minimum five years of experience of the bidder in providing services for any Centr....
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.... quote (L1) shall be the Preferred Bidder. For avoidance of doubt, it is clarified that in case L1 bidder fails to provide required services within defined time lined, the authority reserves right to invite L2 bidder to provide required services in terms of this RFP." 8. Pursuant to the aforesaid tender call notice, all total six bidders participated in the tender process, out of which five bidders, including the petitioner, were qualified for having scored more than 60% marks in terms of the RFP and became eligible for opening of financial bid. Accordingly, their financial bids were opened and they were found to have quoted their prices to the following effect:- Name of the Bidder Cost of Man-hour to be charged by the Bidder (In Rupees) 1 M/s. Compuet Lab. Bhubaneswar Rs. 97.00 2 M/s Laxsan Associates Bhubaneswar Rs. 77.059 3 M/s R.R. Enterprises, Bhubaneswar Rs. 75.09 4 M/s Care Security & Allied Service, Bhubaneswar Rs. 77.45 5 M/s. Swarnadevi Agency, Cuttack Rs. 16,028.29 (mentioning per month per person) 9. After evaluation of qualifying criteria and opening of financial bids, the tender committee in its meetin....
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....he State or instrumentality of the State, such as Corporation, the Court prima facie concerns whether there has been any infirmity in the decision making process. In that case, the Court can examine whether the decision making process was reasonable, rationale not arbitrary and not violative of Article-14 of the Constitution of India. 12. In Erussion Equipment and Chemicals Ltd. v. State of West Bengal, AIR 1975 SC 266, the Apex Court held as follows: "When the Government is trading with the public, 'the democratic form of Government demands equality and absence of arbitrariness and discrimination in such transactions'. The activities of the Government have a public element and, therefore, there should be fairness and equality. The State need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure." 13. In Ramana Dayaram Shetty v. I.A. Authority of India, AIR 1979 SC 1628, the Apex Court held as follows : "It is true that the Government may enter into a contract with any person but in so doing the State or its instrumentalities cannot act arbitrarily. The tenders were to be adjudged....
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....nciple of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure." The apex Court also noted that there are inherent limitations in the exercise of power of judicial review in contractual matter. As such, it was observed that the duty to act fairly will vary in extent, depending upon the nature of cases, to which the said principle is sought to be applied. It was further held that the State has the right to refuse the lowest or any other tender, provided it tries to get the best person or the best quotation, and the power to choose is not exercised for any collateral purpose or in infringement of Article 14. 17. In Air India Ltd. v. Cochin International Airport Ltd. (2000) 2 SCC 617, the apex Court, while summarizing the scope of interference as enunciated in several earlier decisions, held as follows:- "7. ... The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transactio....
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....cess adopted or decision made by the authority is mala fide or intended to favour someone; OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: "the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached"; (ii) Whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226. Cases involving blacklisting or imposition of penal consequences on a tenderer/contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action." Similar view has also been reiterated in Michigan Rubber (India) Limited v. State of Karnatak, (2012) 8 SCC 216 and Maa Binda Express Carrier v. North East Frontier Railway, (2014) 3 SCC 760. 20. In Afcons Infrastructure Limited v. Nagpur Metro Rail Corporation Limited, (2016) 16 SCC 818, the apex Court held that the constitutional courts are concerned with the decision making process. A decision if challenged (the decision....
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....iew is intended to prevent arbitrariness and it must be exercised in larger public interest. Expression of different views and opinions in exercise of contractual powers may be there, however, such difference of opinion must be based on specified norms." 24. In Mihan India Ltd. (supra), the apex Court in paragraphs-43 and 47 of the said judgment held as follows: "43. Bare perusal of the above stated case-law in light of the facts of the instant case makes it clear that merely having the power of rejection of bids does not entitle authorities to exercise the said power arbitrarily. While discussing the applicability of Clauses 2.16.1, 3.3.1 and 3.3.5, it is made clear that in pre-bid procedure prior to acceptance, the bidding process may be annulled otherwise after issuance of LoA, the annulment cannot be done. 47. Analyzing the facts of this case in the light of the judgments in Dinesh engineering (supra) and Shishir Reality (supra), after issuing the LoA in terms of Clause 3.3.5 of RFP and declaring GAL as concessionaire as per Clause 3.3.6, issuing letter of annulment of bidding process on the basis of the meeting of PMIC on 14.10.2019, which directed for re-....